O’Reilly Automotive Inc. (NASDAQ: ORLY) is among the 14 Best Consumer Discretionary Stocks to Buy Right Now. Morgan Stanley reduced its target price on ORLY to $108 due to rising cost pressures, impacting 2026 and 2027 EPS forecasts. Despite this, O’Reilly saw 9.8% YoY growth in net income and 7.8% YoY growth in sales in Q4 2025.

Sales growth was driven by both same-store sales growth and store count expansion, with 207 net store additions year over year. However, operating profit margins saw a 80-basis point YoY erosion, mainly due to higher costs of sales and administrative expenses. Management expects revenue growth of 5.2% to 6.9% in 2026, targeting gross profit margins of 51.5% to 52.0%.

O’Reilly Automotive Inc. is a retail outlet operator specializing in automotive aftermarket parts, equipment, and accessories. Founded in 1957, the company is headquartered in Springfield, Missouri. While ORLY shows investment potential, some believe certain AI stocks offer greater upside potential with less downside risk. For those interested in undervalued AI stocks, a free report is available.

Read more at Yahoo Finance: Morgan Stanley Trims O’Reilly Auto (ORLY) Target Price to $108, Due To Rising Costs